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19.March.2025
News

Suspicion of money laundering: Bank does not have to pay a customer’s legal fees even if there is a delayed repayment when suspicious activity is reported (OLG Frankfurt am Main)

On February 25, 2025, the Higher Regional Court of Frankfurt am Main ruled (Case No. 10 U 18/24) that a bank that does not disburse a customer's funds for several days due to a suspicious activity report filed under money laundering law is not obliged to reimburse the customer's legal fees. Background to the case Within a few days, the plaintiff's account was credited with two large amounts (totaling EUR 1 million). Due to these unusually high amounts, the bank reported the transaction to the Financial Intelligence Unit (FIU) in accordance with Section 43 of the German Money Laundering A…
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4.March.2025
Audit, News, Mandates

Uncertainties of CSRD adjustment: The VSME reporting standard as a way forward?

Background: Uncertainties of CSRD adjustment Last week, the EU Commission presented its proposals for revising the Corporate Sustainability Reporting Directive and other legal acts (see our previous post for more on this). Since it is unclear at this stage which simplifications will pass through parliament, large companies (according to the German Commercial Code, i.e. HGB) with fewer than 1000 employees are facing a great deal of uncertainty. Even if a two-year postponement to 2028 (report on the 2027 financial year) is considered likely, companies could receive data requests from large bu…
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4.March.2025
News

Federal Court of Justice ruling on data reporting to SCHUFA – Non-material claim for damages in the event of impermissible reporting of disputed or non-enforceable claims

In its judgment of January 28, 2025 (Case No. VI ZR 183/22), the 6th Civil Senate of the Federal Court of Justice ruled that the defendant is entitled to non-pecuniary damages in the amount of 500 € under Art. 82 (1) GDPR as the plaintiff had reported the defendant's personal data to SCHUFA without authorization. This report was inadmissible because the plaintiff's claims were disputed and not legally enforceable. The unjustified entry affected the defendant's creditworthiness and made it more difficult for her to participate in economic life. In this case, a mobile phone provider had arran…
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27.February.2025
Audit, News

European Commission’s omnibus proposal on sustainability reporting

On 26 February, the European Commission published its proposals to relieve the burden on businesses by adapting several sustainability regulations. The proposals for the so-called Omnibus Directive address the Corporate Sustainability Reporting Directive (CSRD), EU Taxonomy, Corporate Sustainability Due Diligence Directive (CSDDD) and the Carbon Border Adjustment Mechanism (CBAM). In the following, we summarise the far-reaching proposed changes for CSRD, CSDDD and Taxonomy. Changes to the scope of application and shifts First of all, the thresholds are to be aligned and increased. The in…
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5.February.2025
News

AML: New BaFin interpretation and application notes (AuAs)

On February 1, 2025, the amended interpretation and application notes (AuAs) on the german Anti-Money Laundering Act (GWG) published by BaFin on November 29, 2024 came into force. This revision of the AuAs brings important changes for supervised companies: Significant innovations Shortened update periods for customer data: Annual review for enhanced due diligence, every five years for medium risk Guidelines for verifying beneficial owners: Data must be collected directly from the contractual partner. Collection solely with the help of publicly accessible sources, credit agencies or f…
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31.January.2025
News

Audit opinion on sustainability reporting CSRD: IDW turns to EU Commission

Background In November 2024, the EU Commission published an FAQ on sustainability reporting (see: FAQ of the European Commission). In a letter to the EU Commission, the Institute of Public Auditors in Germany (IDW) has expressed its concerns regarding the contents of the FAQ. What are the IDW's concerns and what are the consequences for companies? Assistance yes, but additional requirements must not arise In view of the challenges involved in interpreting the CSRD and the ESRS, the IDW considers the FAQs to be a valuable source of guidance. However, the IDW emphasises that the rights …
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24.January.2025
News

FAQ from the European Commission on sustainability reporting

The European Commission has recently published answers to frequently asked questions on the interpretation of the CSRD. Although many points echo the regulations of the CSRD, the EU also offers important insights into the interpretation of ‘reasonable efforts’, the obligation to report on intangible resources and the supervision of reporting. The key findings are summarised below. Requirements for the disclosure of information along the value chain The European Sustainability Reporting Standards (ESRS) require companies to disclose material information about their value chain. The inform…
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19.November.2024
News

Impact of the Corporate Sustainability Reporting Directive (CSRD) not being transposed into German law by 31 December 2024

Background The European Union's CSRD requires transposition into national law to become legally effective. Due to the open legislative process in Germany and the break-up of the governing coalition, it is unlikely that the CSRD Implementation Act (CSRD-UmsG) will be passed by 31 December 2024. This has far-reaching consequences for the ESG reporting obligations for the financial years 2024 and 2025 and their audit. Consequences for companies reporting under ESRS for the first time in 2024 The following aspects arise for companies that would be required to report under the European Sus…
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27.September.2024
Audit, News

EFRAG decides on drafts of sector classification and first ESRS sector standard

Background The EFRAG has approved the drafts for the sector classification and the sector standard for the oil and gas sector for public consultation. This is an important step towards EFRAG's goal of developing complementary standards for sustainability-related industries. The application of the sector standards finalised by then is expected to be mandatory for all reporting companies from June 2026. For this requirement, companies must generate at least 10% of their revenue in one of the covered sectors or be associated with material actual or potential negative impacts there. Content …
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5.July.2024
Audit, News

EFRAG publishes further support for the implementation of the ESRS

Background The EU's Corporate Sustainability Reporting Directive (CSRD) is estimated to affect over 11,000 German companies. These companies are required to report in accordance with EFRAG's European Sustainability Reporting Standards (ESRS). Dealing with double materiality and the value chain as well as deriving the relevant disclosure requirements is proving to be particularly challenging for many companies. Final publication of the EFRAG Implementation Guidances To this end, EFRAG has published further recommendations ("Implementation Guidances") to help companies with implementati…
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